Evarts City Council members learned during their monthly meeting Tuesday that $35,742 received by the city during the 2007-2008 fiscal year was not deposited into city checking accounts.

Certified public accountant Troy Gaw, the city's auditor, informed the council that he discovered $21,997 in the water account, $8,107 in the sewer account and $5,640 in the sanitation account was not deposited into checking accounts as he conducted the city's financial audit for the 2007-2008 year.

“My recommendation is that there be some additional procedures put in place that will review, on a monthly basis, from what the billing computer says has come in and should have been deposited to what was actually deposited,” Gaw said.

Although Gaw discovered missing funds, he praised Evarts officials for the current financial status of the city.

“Of course, there is always room for improvement. But the city is doing a very good job in their record keeping. Everything was available for inspection that I requested, and it didn't take a lot of time to put your hands on it and pull it out, which is always a good sign,” Gaw said. “For a city this size and the number of citizens, I think this city is doing a real good job.”

Apparently, the Kentucky State Police has the alleged matter under investigation.

KSP Sgt. Mark Gillingham later updated council members of his ongoing investigation.

“My plans are to wrap it up by the early part of next week, and we should know something definitive by that time,” Gillingham stated.

After the meeting, Evarts Mayor Burl Fee said he and the council agreed an investigation should be conducted after he began to detect that funds were missing in July 2008.

“We didn’t have enough money to make the bond payments for the city’s water treatment facility. So I got David Smith (the city’s bookkeeper) to start checking and see why there wasn’t enough money in the account. That’s when he started to figure that money was missing,” Fee stated.

Fee said after discovering the missing funds, he called an Oct. 30 meeting with Smith, city attorney Otis Doan and former city clerk Trish Kron. After the meeting, Kron resigned from her duties as the city’s clerk.

“She could have resigned or been fired,” he stated.

Fee said an investigation into the missing funds began in the middle of May and added that the period of time being investigated is from July 2007 to September 2008.

Fee said the city has already collected $10,000 in bond money to help replace the missing money.

“Since some of this happened in 2007, we are going to attempt to obtain bond money from that year also,” he added.

Kron began serving as the city’s clerk in August of 2006.